China Focus: 2019 Top 10 Cosmetic Regulatory Updates

2019 was an eventful year in China's cosmetic sector, during which we witnessed many essential regulatory changes. ChemLinked has picked our top ten most important regulatory changes in 2019 which are listed below.

10. China Officially Passes First Local Cosmetic Safety Regulation

On March 28, 2019, Guangdong Cosmetics Safety Regulation was officially passed in Guangdong province and was scheduled to be implemented on Jul. 1, 2019. This regulation clarifies cosmetic supervision requirements, including the 14 categories of banned cosmetic, the safety management responsibilities of network cosmetics operators and online trading platforms and the establishment of a risk management mechanism. The regulation applies to all the cosmetic enterprises in Guangdong province. (Read More)

ChemLinked Interpretation:

This regulation is a nationally authorized legislative exploration implemented at a local level. The influence will not be confined to Guangdong Province but will radiate throughout China. Cosmetics produced in other regions entering Guangdong Province shall comply with this safety regulation.

9. CBEC Comprehensive Tax Further Reduced with VAT Reform

During this year’s NPC session on March 5, China initiated a massive tax-cut plan program with an emphasis on reducing the tax burden of manufacturers and SMEs. Under the plan, the value-added tax (VAT) rate has been dropped to 13% from 16% in sectors such as import and manufacturing and to 9% from 10% for transportation and construction industries since April 1, 2019. (Read More)

ChemLinked Interpretation:

VAT is one of the key components of the CBEC comprehensive tax and general trade tax. The massive cuts of the VAT rate will mean a reduction in import duties for international cosmetic stakeholders.

8. China Promulgates 2019 Revised Cosmetics Hygiene Supervision Regulations

On March 18, 2019, China State Council officially approved the partial revisions of the 1989 Cosmetics Hygiene Supervision Regulations, which came into force immediately after promulgation. The updates mainly focus on the changes in cosmetic administrative authorities and the optimization of the cosmetic administration approval process. (Read More)

ChemLinked Interpretation:

The action aims to align the regulation with the current industry practices. Although there appears to be little substance to the new regulations, it marks a significant legislative improvement in the cosmetic industry, given that the State Council's revisions are the first officially-approved revisions to the 1989 cosmetic regulations in the past three decades since its promulgation.

7. China Consults on Draft Regulations for Cosmetic Overseas Inspection

On November 22, China NMPA publicized a draft version of Interim Regulations for Cosmetics Overseas Inspection to strengthen post-surveillance on the overseas R&D and production of imported cosmetic. If the draft version of the regulation is passed unchanged it will unify the post-market surveillance mode and inspection requirements for both foreign and domestic cosmetics. The draft regulation includes details on overseas cosmetic inspection procedures, inspection scope, the competent authority, inspection results, and penalties for violation of the regulation. (Read More)

ChemLinked Interpretation:

The Interim Regulation arrives at a time when foreign manufacturers experienced a lower frequency of post-market inspection than domestic enterprises. The foreign cosmetic facility inspection program was proposed by China NMPA to ensure the fair treatment of all cosmetic stakeholders.

6. China NMPA Bans Cosmetics Using EGF or Medicinal Claims

On January 10, 2019, NMPA issued a collection of answers to FAQs, clearly stating that “EGF” is a banned cosmetic ingredient, and the words "medicated cosmetics," "medical skincare products," "EGF," "human oligopeptide-1" are prohibited to be used on cosmetic labels or in advertisements. (Read More)

ChemLinked Interpretation:

There is no concept of "cosmeceuticals," "medicated cosmetics" in China, and clinical efficacy claims are illegal.

5. China to Ban Microbeads in Cosmetics

On October 30, China National Development and Reform Commission officially passed the Catalogue of Guidance on Industry Structure Adjustment (2019 Version), indicating that the manufacture of daily chemical products containing microbeads will be banned from December 31, 2020, and the sale will be banned from December 31, 2022. (Read More)

ChemLinked Interpretation:

Microbeads are both persistent and bioaccumulative within the ecosystem and pose a significant problem for the marine environment and associated food chains. Many countries around the world have banned or are seeking to ban microbeads in cosmetics. Cosmetics containing plastic microbeads will be phased out in China.

4. China Implements New Testing Regulations for Cosmetic Registration and Filing

On Sept. 10, China NMPA issued a notice to implement a new testing regulation - Working Rules for Cosmetic Registration and Filing Testing. As per the notice, the original “designated testing institute” system for cosmetic registration and filing has been cancelled since Nov. 1, 2019. Cosmetic testing institutions that meet the specified qualification requirements and have submitted required information via the online testing information system are eligible to undertake testing work. (Read More)

ChemLinked Interpretation:

The implementation of the Working Rules allows more third-party testing agencies to conduct testing work for cosmetics registration and filing. The new change will help alleviate the backlog of enterprises awaiting testing services under the old system.

3. China to Implement New Special-Use Cosmetics License Renewal Requirements on June 30^th

On May 29, 2019, China NMPA released an announcement detailing the renewal procedures for imported/domestic special-use cosmetics administrative license. The announcement was implemented on June 30, 2019.

Specifically, applicants intending to extend the validity of domestic/imported special use cosmetic license shall apply for renewal after conducting product self-inspection. For qualified enterprises, the renewed administrative license will be issued by NMPA within 15 working days from the submission of the application. A post-market technical review will be conducted after the issuance of the renewed license. (Read More)

ChemLinked Interpretation:

The new policy has significantly simplified and sped up the renewal procedures for special use cosmetics administrative license. The introduction of the self-inspection report system of enterprises indicates a significant shift away from government supervision, towards corporate self-regulation and post-market surveillance.

2. China Approves 4 New Alternatives to Animal Testing

On March 22, 2019, NMPA approved and included nine testing methods in the Cosmetic Safety and Technical Standards 2015, of which four standards are newly approved alternatives to animal testing. These standards are scheduled to be effective for the relevant testing of cosmetic registration/ filing and post-market surveillance from January 1, 2020. (Read More)

ChemLinked Interpretation:

In 2019, China took another significant step towards phasing out animal testing with the approval of 4 new alternatives. So far, China has seven alternatives to animal testing in all.

1. China Imported Cosmetics Will Likely Be Exempt from Mandatory Animal Testing

On May 27^th, China NMPA released a draft version of Administration Measures for Filing of Non-Special Use Cosmetics for public consultation.

As per the draft, a new filing system is being developed which will make the requirements for imported and domestic non-special use cosmetics the same.  Cosmetic products manufactured under certified GMP conditions and with substantiated safety as defined by risk assessment will be exempted from relevant toxicology tests. (Read More)

ChemLinked Interpretation:

Once implemented China's new cosmetic system will be the first time that the Chinese government will unify the administrative requirements for domestic and imported cosmetics. Both imported and domestic products will be subject to the same filing procedures, filing dossier requirements and post-filing supervision. This is also the first time for China to put forward a viable system that will allow stakeholders to circumvent animal testing requirements for imported non-special use cosmetics, five years after China dispensed with requirements for domestic companies to undertake animal testing in domestic non-special use cosmetics.